Chart of the Day - Wednesday, January 27th, 2021

Today’s Chart of the Day was shared on Twitter by David Rath (@DJwrath). It's a daily candlestick chart of the US Dollar Index ($DXY) over the past six months. We may sound like a broken record here, but the Dollar continues to be one of the most important charts to watch right now. A potential move higher would likely put pressure on Stocks and other risk assets including Commodities, and even Cryptocurrencies. David points out that the Dollar has been pinched between the 20 and 50-day moving average over the past few days. The longer-term trend is still lower, but a countertrend move is not out of the question. If we do see the Dollar mean revert higher in the near term, it would probably set a risk-off tone to the market.